Document Overview

This document is the transcript of the Q4 & FY 2026 Earnings Conference Call for Sarda Energy & Minerals Limited (SEML), conducted on 25th May 2026 and submitted to the stock exchanges on 2nd June 2026.

Company and Call Participants

Management Participants:

  • Mr. Pankaj Sarda – Managing Director
  • Mr. Manish Sarda – Deputy Managing Director, Sarda Metals & Alloys Limited
  • Mr. Padam Kumar Jain – Director and CFO
  • Mr. Nilay Joshi – Executive Director

Moderator: Mr. Parth Chauhan – Adfactors PR

Management Opening Remarks & FY26 Performance Highlights

Mr. Pankaj Sarda provided an overview, highlighting the company's transformation over the last 5 years from a cyclical metals business to a diversified energy and mining company.

Financial Performance for FY26:

  • Consolidated Revenue: Increased 23% YoY to INR 5,928 crores (from INR 4,815 crores in FY25).
  • Consolidated EBITDA: Stood at INR 2,025 crores, representing a growth of 44% YoY (from INR 1,410 crores in FY25). The company exceeded its guidance of INR 2,000 crores EBITDA.
  • Profit After Tax (PAT): Increased significantly by 58% YoY to INR 1,109 crores (from INR 702 crores in FY25).
  • Market Capitalization: The company recently crossed INR 20,000 crores.
  • Dividend: The Board recommended a record dividend of 200%, subject to shareholders' approval.

Financial Performance for Q4 FY26:

  • Consolidated Revenue: Stood at INR 1,258 crores.
  • Consolidated EBITDA: Stood at INR 352 crores.
  • Profit After Tax (PAT): Stood at INR 155 crores, an increase of 53% YoY. Performance was impacted by planned operational shutdowns and seasonality.

Operational Performance for FY26:

  • Thermal Power Generation (ex-captive): Reached a record 4,155 million units, up 84% YoY (from 2,238 million units in FY25).
  • Hydropower Generation: Increased to a record 661 million units, up 31% YoY (from 508 million units in FY25), supported by the commissioning of the 25 MW Rehar project.
  • Energy Segment: Contributed two-thirds of the total EBITDA.
  • Gare Palma IV/7 Coal Mine: Production reached the maximum permissible limit of 1.8 million tons per annum (expanded from 1.68 MTPA). Q4 production was lower due to exhaustion of the annual limit.
  • Iron Ore Pellet Production: Reached a record 826,293 metric tons.
  • Sponge Iron Production: Increased to 345,066 metric tons.
  • HB Wire Division: Achieved record production of 40,425 metric tons.

Balance Sheet & Liquidity:

  • Net Debt: Reduced by over 85% to INR 215 crores as of 31st March 2026 (from INR 1,566 crores as of 31st March 2025). Net debt to EBITDA is well below 1x.
  • Liquidity: Consolidated liquidity remains robust at INR 2,380 crores. The standalone company is net cash positive.
  • Credit Rating: CRISIL rating is AA- with a positive outlook.

Strategic Updates and Growth Roadmap

1. Thermal Power Expansion (SKS Power):

  • The Honorable Supreme Court dismissed all dissenting appeals against the company's resolution plan for SKS Power, paving the way for expansion.
  • The company plans to double the thermal power capacity to 1,200 MW by FY30/31.
  • This is a brownfield expansion; land, water, grid connectivity, and fuel infrastructure are already in place.
  • The company has applied for a new environmental clearance as the previous one had expired.

2. Hydropower Projects:

  • The company approved the acquisition of a majority stake in Adishankar Khuitam Power Private Limited, which holds rights for a 66 MW project in Arunachal Pradesh. Most approvals and critical forest land are secured.
  • Work on three small hydropower projects in Chhattisgarh (totaling 74 MW) is progressing as per plan.
  • The 66 MW and 74 MW projects are expected to be commissioned in 3-4 years.

3. Captive Power & Solar:

  • A 50 MW captive solar power plant is expected to be commissioned before the end of Q2 FY27.
  • A 30 MW TG set replacement project is in the final stages of erection and is expected to be commissioned by the end of Q1 FY27 (June 2026), ahead of the earlier H1 FY27 target.

4. Mining Operations:

  • Development of the Shahpur West high-grade coal mine is progressing, with commissioning targeted before the end of FY27.
  • Approval processes for the Gare Palma IV/5, Bartunga, and Senduri coal mines are progressing as per plan.
  • The company aims to quadruple its mining capacity.

5. Metals Business Expansion:

  • The Board approved the expansion of the iron ore pellet plant capacity in Raipur from 9 lakh tons to 20 lakh tons.
  • The project has an estimated capital outlay of approximately INR 500 crores and is expected to be completed within 2.5 years from commencement.
  • Environment Clearance (EC) is already in place, and the Detailed Project Report (DPR) is under preparation.
  • The rationale is to be ready to process iron ore from new mines expected to open in Chhattisgarh in the next 2-2.5 years.

6. Other Projects:

  • A mineral wool project has been installed to utilize industrial waste.
  • The company is exploring the separation of its renewable energy business, though no conclusion has been reached.

Industry Outlook and Commentary by Mr. Manish Sarda

Mr. Manish Sarda discussed the positive industry environment driven by India's infrastructure push ('Viksit Bharat 2047') and policy initiatives like the INR 37,500 crore coal gasification scheme.

  • Steel: India's crude steel production grew by over 11% in FY26, while China's production fell. Steel prices recovered by 10-15% in Q4 FY26 from multi-year lows.
  • Power: India's peak power demand touched a record 270.8 GW. Exchange prices in Q4 stood at INR 3.75/unit.
  • Risks: Geopolitical tensions in West Asia and the Middle East could lead to higher input costs, supply chain disruptions, and inflationary pressures.

Question & Answer Session Highlights

Capex Plans: Annual capex for the next two years (FY27 & FY28) is estimated in the range of INR 500-700 crores, excluding the major 600 MW thermal expansion. The outlay for the thermal expansion will be determined later.

Power Sale (PPAs): For the 600 MW thermal capacity, PPAs have been signed for 300 MW (medium and long-term). The rest is sold in the short-term merchant market. For FY27, 200 MW will be under PPA, increasing to 300 MW in FY28.

SKS Plant Realization & Output: The average realization for SKS power in FY26 was over INR 5/unit. Sellable units for FY27 are expected to be around 400 crore units, better than the 375 crore units sold in FY26.

Steel Business Outlook: Management believes steel and ferro alloy prices may have bottomed out, but recovery depends on the global scenario and a potential peace agreement in the Middle East.

Godawari Power Share Purchase: The acquisition of shares was described as part of "normal treasury operations" and was not a meaningful investment.

Coal Gasification: The company is evaluating opportunities in coal gasification following government auctions but has nothing material to report yet.

Closing Comments

Mr. Padam Kumar Jain concluded by stating that the performance reflects steady execution of strategic priorities. The company's disciplined approach to deploying surplus cash into diversified growth projects reinforces its commitment to sustainable value creation.

#Tags: #SardaEnergy #Q4Earnings #FY26Results #PowerExpansion #SEBIDisclosure #RegulatoryCompliance #FinancialUpdate #Positive